Report Examines First-Year Implementation of SAFMRs

HUD issued its final rule for the implementation of Small Area Fair Market Rents (SAFMRs) in November 2016. In August of 2017, HUD attempted to suspend the SAFMR rule, but in December of 2017 a U.S. District Court judge ordered it to be reinstated. The new rule became effective in January of 2018, with implementation in mandatory areas beginning in April of 2018. And there are currently 24 metropolitan areas mandated to implement SAFMRs.

The SAFMR rule is intended to better align the setting of payment standards for the Housing Choice Voucher (HCV) program with the goals of promoting residential choice and mobility. The rule is needed since the traditional method of setting payment standards based on the 40th or 50th percentile of rents in a metropolitan region has contributed to the concentration of HCVs in low-income and minority neighborhoods. The SAFMR rule bases payment standards on average rents in ZIP codes, a geography more sensitive to rental variation across metropolitan areas. Basing payment standards on SAFMRs is argued to provide voucher holders with greater access to employment, quality schools, transportation, and other desired amenities, typical of high-opportunity neighborhoods.

A recent report published by the Poverty & Race Research Action Council, “Measuring Fidelity to HUD’s Small Area Fair Market Rents (SAFMRs) Rule: Lessons from First Year Implementation,” argued that public housing agencies (PHAs) could implement the rule in ways that better advance the goal of expanding housing access for HCV recipients in high-rent neighborhoods.

The authors say HUD should invest more resources in educating PHAs, tenants, and landlords about the goals of the rule change and how setting voucher payment standards relates to those goals. Second, HUD should provide guidelines that are more explicit about the value of setting low payment standards in low-rent areas and high payment standards in high-rent areas. Finally, HUD should collect PHAs’ administrative plans, payment standards, and communications with tenants and landlords, to create a central, public repository of those materials.

The full report can be found here.